Monopoly without tax and without price ceiling, Macroeconomics

Assignment Help:

Here from a), profit maximizing price = 7 and Q = 10. It is shown in the figure below:-

148_Monopoly without tax.png

The consumer surplus is shown in blue area which is given as (9-7) *10*1/2 =10 dollar.

 Monopoly with tax of 50 cents per unit

Here from c), profit maximizing price = 7.25 and Q = 8.75. It is shown in the figure below:-

108_consumer surplus.png

The consumer surplus is shown in blue area which is given as (9-7.25 ) *8.75*1/2 =7.65625 dollar.

 
Monopoly without tax, but with price ceiling of $6

Here from d), profit maximizing price = 7.5 and Q = 7.5. It is shown in the figure below:-

The consumer surplus is shown in blue area which is given as (9-7.5 ) *7.5*1/2 =5.625 dollar.
* Perfectly competitive industry

In case of perfectly competitive,

MC = D

ð  5 = 45-5P

ð  P = 8

And Q from equn i) is 5

So consumer surplus = ½ * (9-5)*5 =10 dollar.


Related Discussions:- Monopoly without tax and without price ceiling

International trade, how to maintain equilibrium gdp in foreign trade

how to maintain equilibrium gdp in foreign trade

Explain fines imposed on violations, In 2001, Puerto Rico enacted a law tha...

In 2001, Puerto Rico enacted a law that requires specific labels on cement sold in Puerto Rico and imposes fines for any violations of these requirements. The law prohibits the sal

Show the three approaches of measuring national income, Illustrate the thre...

Illustrate the three approaches of measuring national income? Show that these three approaches give identical result. Explain private saving. How is the private saving used

5 key pieces of data, Review the Federal Reserve Board website. Identify at...

Review the Federal Reserve Board website. Identify at least five key pieces of data (links) you would use in microeconomic decision making on the Web site, and tell what data that

When ochratoxin molds can occur, Q. When Ochratoxin molds can occur? Oc...

Q. When Ochratoxin molds can occur? Ochratoxin A is a phenylalanyl derivative of a substituted isocoumarin produced by Penicillium verrucosum in temperate climate and by severa

Calculate rental price of capital, Let the real interest rate, i r , equal ...

Let the real interest rate, i r , equal 5 percent and the rate of depreciation, d, equal 10 percent.  In this case, if the price of a piece of capital is P K = $10,000, what is th

Basic concepts and terminology, when domestic currency becomes more valuabl...

when domestic currency becomes more valuable in terms of foreign currency, the domestic currency is said to have

What are the economic reasons for protectionism, Question 1: (a) What ...

Question 1: (a) What are the characteristics of market and command economies? (b) In a number of countries in recent years, there has been a movement towards a greater rel

Monopoly model, Use the monopoly model to explain how providers are able to...

Use the monopoly model to explain how providers are able to charge different groups of patients different prices.

Wholesale prices, Wholesale Prices, Consumer Prices and Inflation   From...

Wholesale Prices, Consumer Prices and Inflation   From the man on the street to the highest policy makers, the behavior of prices is of intimate concern. Prices determine the pu

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd